The PMI Friday is here once again. We have often seen a fair amount of volatility around the PMI releases so today shouldn’t be an exception. The day starts with the French services and manufacturing PMI numbers that are released at 8:15 am GMT and continues with the German, EU, UK and US PMI releases. The Canadian retail sales numbers are also released today. The UK retail sales were a big disappointment at -8.2% vs. -3.0% expected. This sent the Cable lower. See our economic calendar for more information. By reading further you agree with our disclaimer at the bottom of this page and acknowledge that we do not provide investment advice.

Philly Fed manufacturing index was a positive surprise yesterday. The number was confirmed at 23.1 vs. 20.3 analyst consensus expectation. This should have supported the stock prices but the major US indices closed lower yesterday. The Treasury Secretary Janet Yellen’s comments didn’t help the markets to stabilize. Yellen said yesterday that the US will keep the Trump administration tariffs on China in place but that they will be reviewed later this year. She also talked about the stock market and mentioned that the valuations are high. Yellen cautioned investors to be careful with some of the market sectors. S&P 500 CFD traded to 3884 support before attracting buying and is now trading higher at 3911.

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Stocks, crude oil and gold have traded lower since our last report but it seems that gold traders are willing to defend the 1764 support level. The price of gold traded briefly to 1760 or so but then rallied and is at the time of writing this trading well above the 1764 threshold. A decisive break above 1777 intraday resistance would indicate commitment from the bulls.  Otherwise, the pressure builds on the supports again.

Oil traded lower on profit-taking and expectations that the OPEC+ supply could increase. This took the market to our support level at 58.82 where buyers started to come in and bounced the price higher. The low print for today has been 58.56. It is worth noting that supports and resistances rarely are exact levels but rather areas near key price points. The US crude oil inventories were again much lower than expected (-7.3M vs. -2.1M). However, it seems that traders are focusing on the potential supply increase from the OPEC+.

EURUSD dipped to 1.2023 before attracting buyers day before yesterday and had yesterday a solid up day with a close very near the high of the range. This indicates strength and it could well be that the market has now put in the higher low we have talked about in our previous EURUSD analyses. Higher lows suggest that the longer-term uptrend is about to resume again. The key support and resistance levels are 1.1952, 1.2023 and 1.2190.

GBPUSD is trading close to the upper end of the bull channel and has shown resilience in that the pair didn’t sell off even though we saw a daily close below the 1.3866 support. The next important support can be found at 1.3758 – 1.3782 where we have the 23.6% retracement level, 20-day SMA and a high from January 27th.

USDCAD is looking weakish as the rallies have been repeatedly faded by the traders over the last three days. We have two complete shooting star candles in the daily chart and again today the rally was thwarted at 1.2713. Today’s candle obviously isn’t complete yet and not too much should be read into it. There has been, however, a lack of willingness from the bulls to commit to this market. But then again, when looking at the last 7 days of trading the same could be said about the bears. USDCAD has been ranging between 1.2609 and 1.2761. It looks likely that the pair moves towards the lower end of the range before the next rally attempt. There has been some disconnect from the price of oil lately. While the price of oil has rallied strongly USDCAD has been ranging sideways since the end of January. Open a VIP Black account with us. There are no per trade execution or monthly fees on our VIP Black accounts.

Recent macroeconomic data releases

  • US Crude Oil Inventories -6.6M, -0.9M expected
  • US Unemployment Claims 793K, 755K expected
  • UK Preliminary GDP 1.0%, 0.5% expected
  • UK CPI 0.7%, 0.6% expected
  • Canadian CPI 0.6%, 0.5% expected
  • US Core Retail Sales 5.9%, 1.1% expected
  • US Retail Sales 5.3%, 1.1% expected
  • Australian Employment Change 29.1K, 30.2K expected
  • Australian Unemployment Rate 6.4%, 6.5% expected
  • Philly Fed Manufacturing Index 23.1, 20.3 expected
  • Crude Oil Inventories -7.3M, -2.1M expected

Important macroeconomic data releases today

  • UK Retail Sales -3.0% expected
  • French Services PMI 47.0 expected
  • French Flash Manufacturing PMI 51.7 expected
  • German Flash Manufacturing PMI 56.6 expected
  • French Flash Services PMI 46.5 expected
  • EU Flash Manufacturing PMI 54.6 expected
  • EU Flash Services PMI 45.9 expected
  • UK Flash Services PMI 42.1 expected
  • UK Flash Manufacturing PMI 53.1 expected
  • Canadian Core Retail Sales -2.4% expected
  • Canadian Retail Sales -2.5% expected
  • US Manufacturing PMI 58.4 expected

You may access the times and dates in the economic calendar here.

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Janne Muta
Chief Market Analyst
TIOmarkets.com

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